At US$160, Is Abercrombie & Fitch Co. (NYSE:ANF) Worth Looking At Closely?

While Abercrombie & Fitch Co. (NYSE:ANF) might not have the largest market cap around , it received a lot of attention from a substantial price increase on the NYSE over the last few months. Shareholders may appreciate the recent price jump, but the company still has a way to go before reaching its yearly highs again. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. But what if there is still an opportunity to buy? Let’s take a look at Abercrombie & Fitch’s outlook and value based on the most recent financial data to see if the opportunity still exists.

See our latest analysis for Abercrombie & Fitch

Is Abercrombie & Fitch Still Cheap?

Good news, investors! Abercrombie & Fitch is still a bargain right now. Our valuation model shows that the intrinsic value for the stock is $255.19, but it is currently trading at US$160 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, Abercrombie & Fitch’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.

Can we expect growth from Abercrombie & Fitch?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. However, with a relatively muted profit growth of 5.1% expected over the next couple of years, growth doesn’t seem like a key driver for a buy decision for Abercrombie & Fitch, at least in the short term.

What This Means For You

Are you a shareholder? Even though growth is relatively muted, since ANF is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on ANF for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy ANF. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed buy.

In light of this, if you'd like to do more analysis on the company, it's vital to be informed of the risks involved. Every company has risks, and we've spotted 1 warning sign for Abercrombie & Fitch you should know about.

If you are no longer interested in Abercrombie & Fitch, you can use our free platform to see our list of over 50 other stocks with a high growth potential.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.